You may have heard that the real estate market is a little short on inventory. We are definitely feeling that here in the Central Florida real estate market. In March the Orlando Metro ended the month with less than .60 months of inventory available.
In the Downtown area you can see a crystal clear picture of this lack of inventory by simply driving down the streets. The number of for sale sign is certainly less than it used to be. As a buyer entering the market you should be aware of the realities of the market.
The best way to determine how hot a market is doing is through absorption rate. Absorption rate is the rate at which the “market” will absorb the available inventory. In almost every popular neighborhood the absorption rate is over 100%! Meaning every time a new listing comes on the market it will sell immediately. In our graph you can see the few homes for sale in most neighborhoods. College Park is an outlier with 26 active listings but that’s simply because it is a larger neighborhood with more home available in general. In that neighborhood 27 homes sell per month. Well there are 26 available so there’s a good chance they’ll all be gone by the end of the month.
Some neighborhoods have 0 active homes for sale. The neighborhoods with 0-1 homes available for sale, well those are the tricky spots. If you want to live in one of these areas be prepared to make more than one offer and pay over asking price, bring appraisal gaps and more. We can talk strategy. You can get into these areas if you have cash on hand and are willing to do what it takes.
What this chart doesn’t show is how many buyers are competing on each home. We know things are moving quickly due to lack of options, but how many buyers are really out there. It depends on the price point of course, but for every 1 listing in a moderate price range we usually see 10-20 offers. So that would mean we need 10-20X the inventory to keep up with current demand and be balanced. Higher priced homes may be 2-5 offers. Lower priced homes below $350,000 you may be competing with 40 offers or more.
It is simply a numbers game when the demand exceeds supply by so much. If you are thinking of selling the opportunities are plentiful though. Want a cash offer and quick sale? We can make that happen with our Keller Offers program. Or to maximize your home equity, compare your options with a full market exposure sale and see which makes the most sense for your needs. As you can see you don’t have much competition so let’s see if the price is right! Call 407-982-7240 to talk with me about your home value and getting the most for your home while the market is at a historic high.